Global spending on artificial intelligence and cognitive systems will grow to $57.6 billion by 2021, according to a new report from International Data Corp. (IDC).

The company predicts a 50.1 percent compound annual growth rate (CAGR) for the period 2016-2021 and $12 billion in spending this year, representing 59.1 percent growth over last year.

The retail and banking industries will spend the most this year, according to IDC, at $1.74 billion and $1.72 billion, respectively, with discrete manufacturing, healthcare and process manufacturing each also spending more than $1 billion. IDC predicts that these same five industries will lead cognitive and AI spending throughout the forecast, representing 55 percent of all spending in 2021.

Retail will also see the fastest growth, with a CAGR of 58.8 percent throughout the forecast period, though retail is only one of seven industries that will see a CAGR of more than 50 percent, according to the prediction.

This year, customer service agents are the use case that will see the most spending, at $1.5 billion, followed by diagnostic and treatment systems at $1.1 billion. Those use cases will hold their lead throughout the forecast, according to the company.

Intelligent processing automation is pegged as the fifth-leading use case this year, but will move into third place by 2021.

Expert shopping advisors and product recommendations will be the use case to see the fastest growth throughout the period, at 96.6 percent CAGR, with public safety and emergency response close behind at 96.2 percent and intelligent processing automation holding the third spot at 69.2 percent CAGR.

About half of spending throughout the forecast will go to software, though spending on software is projected to slow a bit after 2019. Services spending will see a CAGR of 53.7 percent throughout the period and hardware will see both the lowest spending and the slowest growth, though still experience a significant CAGR of 40.4 percent throughout the forecast.

"Cognitive and artificial intelligence solutions continue to proliferate across all industries resulting in significant growth opportunities," said Marianne Daquila, research manager for customer insights and analysis at IDC, in a prepared statement. "Some of the use cases are very industry specific, such as diagnosis and treatment in healthcare, and in others they are common across multiple industries such as automated customer service agents. The variety, application and nature of cognitive/artificial intelligence use cases is resulting in ubiquitous spend over the forecast period."

About the Author

Joshua Bolkan is contributing editor for Campus Technology, THE Journal and STEAM Universe. He can be reached at jbolkan@gmail.com.